| By Hamza Farooqui |
IF Vardospan were to be successful in its bid to acquire Habib Overseas Bank, it would be a significant first step in ending the banking apartheid that plagues South Africa, almost a quarter of century after liberation
Bloomberg News published a story in which it claimed the South African Reserve Bank (SARB) made a recommendation to the Treasury that Vardospan’s bid to create South Africa’s first 100% black-owned bank, should be rejected.
If Vardospan were to be successful in its bid to acquire Habib Overseas Bank, it would be a significant first step in ending the banking apartheid that plagues South Africa, almost a quarter of century after liberation.
South Africa’s financial services sector is still dominated by its Big Four banks and entry to this sector is controlled by SARB. The financial services sector desperately lacks competition which is why so many South Africans – most of them black – cannot source capital to be entrepreneurial and escape grinding poverty.
My dream is that a black entrepreneur can walk into a black-owned bank, and borrow capital from a black bank manager at a normal interest rate. The fact that is still a dream in 2017 is a national tragedy. Money and trade are forces that don’t discriminate by colour.
On 24 January, this country’s biggest business newspaper (Business Day), wrote:
“The public is aggrieved over the tight hold the banks and other large corporations have over an economy it believes should be more transformed.”
The newspaper is correct.
There is absolutely no reason why Vardospan’s bid should be rejected other than the privileged financial elite manoeuvring to protect its monopoly hold on banking services.
We will never end the economic apartheid in this country without ending banking apartheid first.
Vardospan remains committed to the creation of a robust, black-owned challenger bank. It is what our rainbow nation desperately needs.
Vardospan (Pty) Ltd is the acquisition vehicle that has been established for the acquisition of Habib Bank SA. It is led by businessman Hamza Farooqui.
— Feb 7, 2017 @ 16:30 GMT